netwealth unveils managed account service

Netwealth joint managing director Matt Heine.


By Julie May

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Financial services group netwealth has launched its much-anticipated managed account service, in addition to announcing a $1.9 billion spike in funds under management (FUM) via its investment platform to $7.3 billion this financial year.

Speaking to financialobserver yesterday, netwealth joint managing director Matt Heine said the company’s fully integrated managed account service offering was expected to have a further positive impact on FUM across the group as it would provide an added investment vehicle for platform users.

“External mangers and managed discretionary account operators have had the ability to use our technology to administer their internal managed accounts, and now in addition to that netwealth is offering its own managed account service, specifically a separately managed account (SMA),” Heine said.

“The product currently provides access to four managers and 10 models, which will be run under a netwealth non-unitised managed account structure integrated into our broader investment and superannuation platform offering.”

Current managers included UBS, Ralton Asset Management and Bennelong Funds Management, while Ibbotson Associates would oversee a range of netwealth options. Meanwhile, further managers and models would be added over the coming months, he said.

As part of a wider managed accounts service play, and separate to the netwealth managed account offering, he said the group would also roll out a private label service to licensees looking to offer their own model portfolios.

“Licensees that have in-house investment expertise have a lot of interest in this space,” he said, adding the group was talking to about 15 to 20 licensees that wanted to expand their offering to planners.

“While this type of offering is generally for licensees that want to expand their suite of services to their own advisers, we are also talking to some groups about exporting those capabilities further.”

He said because netwealth was the responsible entity, its approval criteria was very stringent, so the private label offering would only be available to select groups, which would be revealed in time.

“The key to our managed accounts capabilities is largely around integration, new technology and new legal structures which enable us to hold things at a platform level rather than as a separate entity,” he said, emphasising that new legislation had created efficiencies for the group.

“Managed accounts are increasingly becoming mainstream and we want to be at the forefront of that,” he said.

Meanwhile, the Investment Trends “2014 Platform Report”, released earlier this year, ranked netwealth second among the industry’s investment platforms for overall functionality.

Further, Investment Trends senior analyst Recep Peker told financialobserver in February that the introduction of SMA capability by the likes of Colonial First State, Macquarie and Perpetual, with netwealth soon to launch its managed accounts service, was potentially the big catalyst the Australian SMA industry had been waiting for.

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